Ben Bernanke and the Zero Bound

Laurence Ball

No 17836, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: From 2000 to 2003, when Ben Bernanke was a professor and then a Fed Governor, he wrote extensively about monetary policy at the zero bound on interest rates. He advocated aggressive stimulus policies, such as a money-financed tax cut and an inflation target of 3-4%. Yet, since U.S. interest rates hit zero in 2008, the Fed under Chairman Bernanke has taken more cautious actions. This paper asks when and why Bernanke changed his mind about zero-bound policy. The answer, at one level, is that he was influenced by analysis from the Fed staff that was presented at the FOMC meeting of June 2003. This answer raises another question: why did the staff's views influence Bernanke so strongly? I seek answers to this question in the social psychology literature on group decision-making.

JEL-codes: E52 E58 E65 (search for similar items in EconPapers)
Date: 2012-02
New Economics Papers: this item is included in nep-cba, nep-hpe, nep-mac and nep-mon
Note: EFG ME
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

Published as Laurence Ball, 2016. "Ben Bernanke And The Zero Bound," Contemporary Economic Policy, Western Economic Association International, vol. 34(1), pages 7-20, 01.

Downloads: (external link)
http://www.nber.org/papers/w17836.pdf (application/pdf)

Related works:
Journal Article: BEN BERNANKE AND THE ZERO BOUND (2016)
Working Paper: Ben Bernanke and the Zero Bound (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:17836

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w17836

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().